FAC Explorer

Audit 356336

FY End
2024-12-31
Total Expended
$7.16M
Findings
2
Programs
2
Organization: Edgewood Seniors Preservation Corporation (DC)
Year: 2024 Accepted: 2025-05-15
Auditor: Cohnreznick LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
560437 2024-001 Material Weakness Yes E
1136879 2024-001 Material Weakness Yes E

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $6.98M Yes 1
14.U01 Affordable Housing Program $182,500 - 0

Contacts

Name Title Type
K5MNVKDX2U44 Derek Torton Auditee
2028958900 Mary Beth Norwood Auditor
No contacts on file

Notes to SEFA

Title: U.S. Department of Housing and Urban Development loan programs Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal award activity of Edgewood Seniors Preservation Corporation, HUD Project No. 000EE047, under programs of the federal government for the year ended December 31, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards ("Uniform Guidance"). Because the Schedule presents only a selected portion of the operations of Edgewood Seniors Preservation Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Edgewood Seniors Preservation Corporation. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Edgewood Seniors Preservation Corporation has elected not to use the 10 percent de-minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Edgewood Seniors Preservation Corporation has received a U.S. Department of Housing and Urban Development capital advance in the revised maximum amount of $6,977,213. Edgewood Seniors Preservation Corporation has also received a direct subsidy in the amount of $182,500, which was provided by the Federal Home Loan Bank of Atlanta. The loan balances outstanding at the beginning of the year are included in the federal expenditures presented in the Schedule. Edgewood Seniors Preservation Corporation received no additional loans during the year ended December 31, 2024. See the Notes to the SEFA for chart/table

Finding Details

Finding 2024-001
During the procedures applied to a sample of nine tenant lease files, we noted the following instances of noncompliance with HUD regulations regarding tenant eligibility and the maintenance of lease files. The instances of noncompliance were isolated to five of the nine tenant files. 1. Five instances where the annual recertification process for a tenant was not performed in a timely manner. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Cause The Project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines. Effect or Potential Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code S. Internal control deficiencies Finding Resolution Status In process Reporting Views of Responsible Officials Management made improvements to internal controls surrounding the recertification process when initially made aware of procedures not being performed timely and in accordance with HUD guidelines. Management monitors those initial improvements in internal controls as well as continually makes additional adjustments, as deemed necessary, to tighten these internal controls. Management's improvements to the controls consist of the following: 1. Recertification reminder letters are being consistently sent to residents at 120, 90, 60, and 30 days prior to recertification date. 2. Incentives were put in place to encourage site associates to complete recertification tasks timely including staff lunches. After working hour sessions are also being held. 3. Third party consultants are being utilized when necessary. 4. A HUD specialist was hired during the year to address ongoing terminations and ensure site teams were aware of current and upcoming terminations related to the Section 8 program (improvement of control that occurred during 2024). 5. Site associates are going door to door and enlisting help from resident services teams to engage residents.
Finding 2024-001
During the procedures applied to a sample of nine tenant lease files, we noted the following instances of noncompliance with HUD regulations regarding tenant eligibility and the maintenance of lease files. The instances of noncompliance were isolated to five of the nine tenant files. 1. Five instances where the annual recertification process for a tenant was not performed in a timely manner. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Cause The Project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines. Effect or Potential Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code S. Internal control deficiencies Finding Resolution Status In process Reporting Views of Responsible Officials Management made improvements to internal controls surrounding the recertification process when initially made aware of procedures not being performed timely and in accordance with HUD guidelines. Management monitors those initial improvements in internal controls as well as continually makes additional adjustments, as deemed necessary, to tighten these internal controls. Management's improvements to the controls consist of the following: 1. Recertification reminder letters are being consistently sent to residents at 120, 90, 60, and 30 days prior to recertification date. 2. Incentives were put in place to encourage site associates to complete recertification tasks timely including staff lunches. After working hour sessions are also being held. 3. Third party consultants are being utilized when necessary. 4. A HUD specialist was hired during the year to address ongoing terminations and ensure site teams were aware of current and upcoming terminations related to the Section 8 program (improvement of control that occurred during 2024). 5. Site associates are going door to door and enlisting help from resident services teams to engage residents.